Cape Town - Cash withdrawals fell 9.18% to R440.53 in January, but consumers will regain positive momentum in March, Spark Cash Index (SCI) said on Thursday.
Consumers significantly reduced their spending during January, following record increased cash withdrawal activity in December 2012.
However, MD of Spark ATM Systems Marc Sternberg, said that the steep drop is nothing new.
“Historically, following a surge in spending over the festive season, January is the month when consumers often adopt a more conservative spending approach.
"In addition, there is also the fact that many workers get paid early in December and are often faced with a 'long' month before they get paid again in January, during which they have to curb their spending activity," said Sternberg.
The January figures also indicated a year-on-year (y/y) growth of 5.43%. IHS Global Insight principal economist Ronel Oberholzer said this big growth can be seen as a positive sign.
“Comparing to last year’s levels (2.65% y/y growth recorded in January 2012), consumers are currently in a better situation. However, I suspect that we will soon see a slowing in the rate of increase.”
Sternberg added that retailers will still enjoy positive trading, with the current stable interest rate; and that average monthly withdrawals will pick up in late March 2013 due to the Easter holiday period.
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